Investing.com - The New Zealand dollar plunged against its U.S. rival during Monday’s Asian session on news of milk powder contamination in New Zealand.
In Asian trading Monday, NZD/USD slid 1.13% to 0.7749. The pair is likely to find support around 0.7725 and resistance at 0.7800.
Shares of dairy giant Fonterra also plunged after the company confirmed it had sold contaminated whey protein to eight different buyers in China, Malaysia, Vietnam, Thailand and Saudi Arabia.
China, previously the home of its own milk powder contamination-related scandals, has halted imports of New Zealand-produced milk powder. So has Russia and other countries are expected to follow suit. Milk powder exports account for 15% of New Zealand’s GDP.
Almost 90% of China’s USD1.9 billion billion in milk-powder imports last year originated in New Zealand, and economists said that a prolonged ban could produce a shortage of dairy products in China, the New York Times reported.
Some the contaminated whey passed through Australia before moving on to other markets such as New Zealand, according to several press reports.
Fonterra confirmed that a unit of Coca-Cola, the world’s largest soft-drink maker, and animal feed makers in Australia and New Zealand had also been affected. China is New Zealand’s largest export market.
Elsewhere, NZD/JPY plunged 1.21% to 76.63 while AUD/NZD rose 0.69% to 1.1440 after the Australian Bureau of Statistics said that Australian retail sales remained unchanged last month following a 0.2% increase in June. Analysts had expected Australian retail sales to rise 0.4% last month.
In Asian trading Monday, NZD/USD slid 1.13% to 0.7749. The pair is likely to find support around 0.7725 and resistance at 0.7800.
Shares of dairy giant Fonterra also plunged after the company confirmed it had sold contaminated whey protein to eight different buyers in China, Malaysia, Vietnam, Thailand and Saudi Arabia.
China, previously the home of its own milk powder contamination-related scandals, has halted imports of New Zealand-produced milk powder. So has Russia and other countries are expected to follow suit. Milk powder exports account for 15% of New Zealand’s GDP.
Almost 90% of China’s USD1.9 billion billion in milk-powder imports last year originated in New Zealand, and economists said that a prolonged ban could produce a shortage of dairy products in China, the New York Times reported.
Some the contaminated whey passed through Australia before moving on to other markets such as New Zealand, according to several press reports.
Fonterra confirmed that a unit of Coca-Cola, the world’s largest soft-drink maker, and animal feed makers in Australia and New Zealand had also been affected. China is New Zealand’s largest export market.
Elsewhere, NZD/JPY plunged 1.21% to 76.63 while AUD/NZD rose 0.69% to 1.1440 after the Australian Bureau of Statistics said that Australian retail sales remained unchanged last month following a 0.2% increase in June. Analysts had expected Australian retail sales to rise 0.4% last month.